PREPARED BY: John Wiemer
LB 208 DATE PREPARED: January 23, 2025
PHONE: 402-471-0051
Revision: 00
FISCAL NOTE
LEGISLATIVE FISCAL ANALYST ESTIMATE
ESTIMATE OF FISCAL IMPACT – STATE AGENCIES (See narrative for political subdivision estimates)
FY 2025-26 FY 2026-27
EXPENDITURES REVENUE EXPENDITURES REVENUE
GENERAL FUNDS $479,000 $741,000
CASH FUNDS $19,000 $30,000
FEDERAL FUNDS
OTHER FUNDS
TOTAL FUNDS $498,000 $771,000
Any Fiscal Notes received from state agencies and political subdivisions are attached following the Legislative Fiscal Analyst Estimate.
LB 208 adds to section 77-2708 (1)(d) if a model 1 seller’s sales and use tax functions are performed by a certified service provider and
the certified service provider is compensated pursuant to the streamlined sales and use tax agreement (SSUTA) for performing such
functions, then the model 1 seller shall not receive any collection f ees that are specified in this subdivision.
The bill adds “any other person” to be included in confidentiality requirements regarding sales tax.
Under the bill, the SSUTA is updated to include amendments through December 31, 2024.
LB 208 adds that there shall be allowed to qualified resident individuals against the income imposed by the Nebraska Revenue Act of
1967 a refundable credit as provided in section 77-2703 for indi viduals who qualify for an income tax credit under the Child Care Tax
Credit Act for all taxable years beginning on or after January 1, 2024, a change from all individuals.
LB 208 adds that for purposes of the SSUTA, the data base that assigns zip codes shall apply the lowest combined tax rate imposed in
the nine-digit zip code area if the area includes more than one tax rate in any level of taxing juris dictions, and the database shall apply
the highest combined tax rate imposed in the five- digit zip code area if the area includes more than one tax rate in any level of taxing
jurisdictions.
LB 208 amends how credits are pro-rated when the credit limit is reached regarding the food donation credit and the Nebraska
Biodiesel Tax Credit.
The Department of Revenue (DOR) estimates the following increase to revenue as a result of this bill:
There is estimated to be a revenue increase to the Highway Trust Fund and the Highway Allocation Fund, which is distributed to cities
and counties.
The DOR also estimates minimal costs to it to implement the bill.
There is no basis to disagree with these estimates by the DOR.
CONTINUED ON PAGE 2
LB 208
PAGE 2
ADMINISTRATIVE SERVICES STATE BUDGET DIVISION: REVIEW OF AGENCY & POLT. SUB. RESPONSE
LB: 208 AM: AGENCY/POLT. SUB: Department of Revenue
REVIEWED BY: Ryan Yang DATE: 1/22/2025 PHONE: (402) 471-4178
COMMENTS: The Department of Revenue assessment of fiscal impact from LB 208 appears reasonable.
LB 208 Fiscal Note 2025
State Agency Estimate
State Agency Name: Department of Revenue Date Due LFO:
Approved by: James R. Kamm Date Prepared: 01/21/2025 Phone: 471-5896
FY 2025-2026 FY 2026-2027 FY 2027-2028
Expenditures Revenue Expenditures Revenue Expenditures Revenue
General Funds $ 479,000 $ 741,000 $763,000
Cash Funds $19,000 $30,000 $31,000
Federal Funds
Other Funds $ 3,000 $5,000 $5,000
Total Funds $ 501,000 $776,000 $799,000
Major Objects of Expenditure
25-26 26-27 27-28 25-26 26-27 27-28
Class Code Classification Title FTE FTE FTE Expenditures Expenditures Expenditures
Benefits………………………………………………………………………………………………………….
Operating Costs………………………………………………………………………………………………….
Travel……………………………………………………………………………………………………………
Capital Outlay…………………………………………………………………………………………………...
Capital Improvements…………………………………………………………………………………………...
Total…………………………………………………………………………………………………………….
LB 208 prohibits the sales tax collection fee for model 1 sellers that use a certified service provider (CSP) to
perform the seller’s sales and use tax functions. The CSP already receives compensation from the state through
contract provisions with the Streamlined Sales Tax Governing Board .
The bill adds the phrase “or any other person” when dealing with the confidentiality requirements for state sales
tax. This change mirrors the state income tax confidentiality law requirements .
The bill updates the ratification date for the streamlined sales and use tax agreement through December 31, 2024.
Currently, it is ratified through December 31, 2015.
LB 208 also adds language to the child tax credit, making the refundable tax credit only eligible to residents of
the State of Nebraska like other refundable tax credits.
The bill also changes the default state tax rate listed for the ZIP code in the state’s rate and boundary database if
an incomplete address is used. Currently, the state defaults to the lowest state sales tax rate in the ZIP code. This
bill changes that to the highest sales tax rate. If a nine-digit zip code is listed the rate will continue to default to
the lowest sales tax rate in that ZIP code.
Also, the bill makes changes in prorating tax credit limits for two income tax credits, food donation and Nebraska
Biodiesel Tax Credit. Currentl y, these credits are set up to allow donations through the entire year and require all
donations to be prorated at the end of the year if the donations went above the donation cap. The new language
states that no additional credits can be allowed after the credit limit is attained and donations that exceed the limit
on the day the limit is reached will be prorated.
LB 208, page 2 Fiscal Note 2025
It is estimated that this bill will have the following impact on General Fund revenues:
General Fund
Revenues
Highway
Trust Fund
Highway
Allocation Fund
FY25-26 479,000 19,000 3,000
FY26-27 741,000 30,000 5,000
FY27-28 763,000 31,000 5,000
FY28-29 786,000 32,000 6,000
It is estimated that there will be minimal costs to the Department of Revenue to implement this bill.
The operative date for this bill is three months after adjournment of the Legislature.